EM equities will deliver 10% per year until 2015 - BarCap

Emerging markets are set to continue delivering higher growth and lower volatility than developed markets, with EM equities to return more than 10% per year until 2015, says Barclays Capital.

The investment bank says in its Equity Gilt Study although growth in the developing economies is recognised among investors, it is not yet fully priced into the equity markets. However, the substantial growth of countries like China and India is fuelling demand for commodities at a rapid rate and causing inflationary pressure. The bank says soaring commodities demand is making it difficult for technological developments to allow production to catch up, meaning scenarios of excess supply are limited. This makes commodity prices "extremely susceptible" to small shocks, such as volatile ...